July canola is down $0.50/mt with November canola up $2.30/mt, July soybean oil is up 0.47 cents/pound, August European rapeseed is up 2.75 euro/mt and August Malaysian palm oil is up 1.58%. December oats are down 10 1/4 cents/bushel. August crude oil is up $1.07/barrel, August ULSD is up $0.0717/gallon, and the September Canadian dollar is up .00185 at .70685. The September U.S. Dollar Index is down .261 at 101.130 and the July Brazilian real is up .00095 at 0.19300.

Grain and oilseed markets have recovered from overnight losses with most trading meaningfully higher on the day, following a similar pattern in energy markets.

Iran's military (the IRGC) warned vessels overnight that passage without its permission would not be safe. Reports are indicating that they made their point not long ago with an attack on a ship trying to do just that, striking its bridge. With that, energy markets reversed higher, leaving part of the price gap in crude oil from early March unfilled. Should prices continue to bounce from here, that would be a positive technical sign as buyers were not willing to risk missing out by waiting for prices to fall to the bottom of the gap. Time will tell.

The ongoing heat wave and accompanying drought in Europe helped turn European rapeseed higher which supported canola's recovery. It may have also played a role in the reversal in the corn market that has resulted in a divergence bottom. For more on the situation, see today's blog at https://www.dtnpf.com/….

Outside markets are reacting positively to the PCE inflation data released this morning that was roughly in line with expectations, even if it did report the highest headline inflation rate seen since April 2023 at 4.1%. With that, stocks and bonds are both slightly higher while the U.S. dollar has pulled back on the relief that it may result in a less aggressive Federal Reserve. In fact, the market is no longer pricing in a second interest rate hike, just one quarter-point increase in the Fed Funds rate for the September meeting.

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